Archive | September, 2012

by Yang Razali Kassim | RSIS - The Association of Southeast Asian Nations (Asean) is displaying a sense of urgency to get the proposed Code of Conduct (COC) in the South China Sea off the ground.

A Japanese coast guard ship, right, pursues a Taiwanese fishing boat near the disputed Senkaku/Diaoyu islands in the East China Sea on September 25.

The latest manifestation is a joint statement by Singaporean and Vietnamese leaders. Following a visit on September 14 to Singapore, general secretary of the Vietnamese Communist Party, Nguyen Phu Trong, and Singaporean Prime Minister Lee Hsien Loong stressed the importance of starting talks on the COC “as soon as possible”.

The same urgency has been expressed in other regional capitals since Asean restored some of its dented credibility with a joint statement of principles on July 26 following the failure of the 45th Asean Foreign Ministers Meeting (AMM) in Phnom Penh to issue a joint communique on the South China Sea disputes.

The draft COC, which has been discussed by Asean in Phnom Penh, has to be negotiated with China and readied in time for the Asean summits in November. Asean leaders will first meet among themselves, and then have back-to-back summits with their East Asian counterparts China, Japan and South Korea, as well as five other powers, including the United States. These key actors have stakes in a region that is currently roiling with tension over territorial disputes in the South China Sea and the East China Sea. An anti-Japan nationalist groundswell in China is threatening to escalate into a major confrontation between the two neighbours over the disputed Senkaku/Diaoyu islands.

The coming Asean and East Asia summits will therefore be the most critical gathering of regional leaders in years. They will affect regional peace and shape the security architecture of not just East Asia but also the wider Indo-Pacific region in view of the far-reaching repercussions.

With only three months to go, putting in place a COC process is vital – at least as a framework for negotiations. If managed sensitively, a COC in the South China Sea has the potential to also become a template for dispute resolution in the East China Sea. The US, while declaring its neutrality, has warned of conflict breaking out in the event of a miscalculation over the Senkaku/Diaoyu disputes, which could drag it in. Needless to say, the same apprehension lies behind the current rush in Asean for the much-anticipated COC for the South China Sea.

But China, as a principal actor in the territorial disputes in both bodies of water, and a key party to the regional COC with Asean, appears to be in no hurry. While on a visit to Jakarta as part of a regional trip on August 11, Foreign Minister Yang Jiechi said China was willing to work with Asean to implement the Declaration on the Conduct of Parties in the South China Sea (DOC). But at the same time, this exercise, he said, should be “on the basis of consensus” towards “the eventual adoption of the COC”. The Chinese foreign minister has reportedly also said that China would approach the COC “when the time is ripe”.

In other words, whatever Asean comes up with to resolve the South China Sea disputes will not fly without the concurrence of China. Besides, before the COC is agreed, Beijing would prefer to focus on implementing the DOC – which is one significant step before the COC. Clearly, the COC negotiations will be tough and protracted. While Asean and others want to step on it, especially in view of the growing tensions in the region, China seems intent to bide its time.

Unlike the DOC, the COC is supposed to be binding. But whether it will indeed be so is not a certainty. Asean has proposed key elements to reflect the underlying principles of peaceful resolution of disputes; conformity with international law; and mechanisms for dispute resolution and for monitoring the implementation of the COC. By now the key elements would have been forwarded to China for consideration.

But at what point should China come into the picture in the drafting of the COC? On April 4, the Philippines said only Asean members would be involved in the drafting. Indonesian Foreign Minister Marty Natalegawa, taking a different tack, said: “There will be constant communication through the Asean-China framework so that whatever final position Asean comes up with, (it) will have benefitted from some kind of communication with China as well.”

From China’s perspective, the South China Sea disputes are best addressed within the framework of the Asean-China summit track (Asean+1). In other words, even the drafting of the COC has to have Beijing’s concurrence. Dr Marty’s formulation of China’s entry into the drafting process is therefore a compromise: it allows Asean its own space to discuss what essentially is an internal affair that affects all members – claimant state or not – while still exchanging notes with China as a negotiating partner.

As a confidence-building measure, a regional COC actually fits in with China’s geo-strategy. It was the late Deng Xiaoping who came up with a formula to resolve competing claims over territory: disputing parties should shelve their claims pending a resolution and in the meanwhile jointly develop the disputed areas. If Beijing does go for the so-called “Deng Xiaoping solution”, joint development will be one of the key elements in China’s version of the COC.

This, however, does not mean it will be accepted by the Asean claimants. While the Deng formula is pragmatic, the underlying dispute over sovereignty will still be in the way. In fact, some of the Asean claimant states may have reservations about the “develop now, resolve later” approach. Acceptance, they fear, might imply recognition of China’s claim to the disputed areas.

Regardless, moving from the DOC to the COC phase is critical if the region is to contain and defuse the current tensions in the South China Sea. Indeed, it may also have an effect on the tensions further north in the East China Sea that are calling out for cooler heads to prevail.

Yang Razali Kassim is a senior fellow with the S Rajaratnam School of International Studies, Nanyang Technological University, Singapore.

by Kevin Voigt | CNN - Hong Kong – When Chinese Vice President Xi Jinping called Tokyo’s territorial claims on a group of East China Seas island “a farce,” he echoed national sentiment of protesters who took to the streets in anti-Japan protests in recent weeks.

“Japan should rein in its behavior, not utter any words and prevent any acts that undermine China’s sovereignty and territorial integrity,” said Xi — who is expected to become China’s new president next month — at a Wednesday meeting with U.S. Defense Secretary Leon Panetta, state media reported.

As Beijing’s presumptive new leader wades into the Japan-China dispute, analysts say the stakes are being raised in a dispute that is largely being led by nationalist fervor rather than government policy or underlining economic interests. And the détente that usually follows these territorial disputes is muddied by the leadership change in Beijing expected next month.

“This is where it’s becoming dangerous,” said Alan DuPont, defense expert at the University of New South Wales. “No incoming Chinese leader can be perceived to be weak on territorial claims.”

On Monday, the Japan Coast Guard said two Chinese surveillance ships entered its territorial waters, while 10 other Chinese ships patrolled nearby. Meanwhile, China announced Sunday it was postponing planned celebrations later this month marking the 40th anniversary of normalization of relations between Beijing and Tokyo.

The bellicose rhetoric also charts the rise of an assertive China and a sea change in the forces shaping Pacific politics that are writ small in the battle over the uninhabited island chain, known as Diaoyu in China and Senkaku in Japan.

“China’s feeling more confident both in its position and in its right to the area both legally and politically,” Mark Valencia, a fellow at the National Asia Research Program and expert on the South China Sea dispute. “And nationalism in China has gained strength and influencing the government.”

Rising tensions in China waters

The East China Sea isn’t the only flashpoint for territorial tensions among China and its neighbors. The South China Sea is dotted with hundreds of largely uninhabited islands and coral atolls, many of which have competing claims from China, Vietnam, the Philippines, Malaysia, Brunei and Taiwan. Just like the friction with Japan, there have been increasing incidents of tension between China and its South China Sea neighbors over island claims.

In 2011, Vietnam claimed that Chinese patrol boats cut cables from PetroVietnam boats during oil and gas surveys in disputed waters. Beijing said that Vietnamese vessels have been illegally surveying in Chinese waters and harassing Chinese fishing boats. The same year Philippines also reported boats cutting cables of a survey ship and threatening to ram its boats.

“A lot of this wouldn’t be happening if China wasn’t becoming more assertive and being more confident, and that’s one important issue why all these issues are becoming more salient,” DuPont said.

The difference in the East China Sea is the collective might of China and Japan, the second and third largest economies in the world, respectively. “When you have two major nation states involved, it’s more dangerous than the (South China Sea),” DuPont said.

A nationalist wave

The often violent protests that broke out in dozens of Chinese cities — from Guangzhou in the south to Qingdao in the north — came to a head after the Japanese government bought the disputed islands from the Japanese family that have privately owned the islands on September 11 for 2.05 billion yen (US$26.2 million).

Dozens of Japanese factories and businesses temporarily shut their doors in the wake of the violence as angry crowds overturned Japanese brand cars and looted Japanese stores in some areas. The island dispute, which traces back centuries, have reached diplomatic boiling points in 1996, 2005 and most recently in 2010, when a Chinese boat allegedly rammed a Japanese patrol boat, resulting in the arrest of the Chinese sailors.

“I don’t think anyone thought the Chinese reaction would have been as strong as it was, and I don’t think anyone expected the level of violence that we saw, especially looking at past incidents,” said James Manicom, an expert on maritime disputes at the Balsillie School of International Affairs in Waterloo, Canada.

The “nationalization” of the islands infuriated Chinese, although analysts say Tokyo’s move was an effort to wrest the issue away from Japanese nationalists, led by Tokyo Governor Shintaro Ishihara who launched an online appeal to buy the islands. Donations poured in, prompting a sharp rebuke from China and forcing the Japanese government to wade into the dispute with its own offer for the contested land.

“If you’re interested in stability, the Japanese government is better than owning the islands than a group of nationalists, because who knows how they might raise tensions,” Manicom said. “(Prime Minister) Noda’s calculation is, this is going to explode in the short-run, in the long run it’s better.”

Economic interests

Although nationalistic ardor on both sides of the dispute have brought the current situation to a boil, national interest in the territory can be traced to a 1969 United Nations geological survey that contains this tantalizing line: “A high probability exists that the continental shelf between Taiwan and Japan may be one of the most prolific oil reserves in the world.”

Also under its South China Sea lie potentially huge reserves of natural gas and oil. A Chinese estimate suggests as much as 213 billion barrels of oil lie untapped in the South China Sea – which, if true, would make it the largest oil reserves outside of Saudi Arabia, according to the U.S. Energy Information Administration.

At the heart of all these island disputes in China Seas is a term of international maritime law known as “;Exclusive Economic Zone,” where nations are allowed sole rights to fish and develop resources within 200 nautical miles of a country’s shores. That has created interest in nation’s grabbing uninhabited islands – often little more than rocky atolls – to thereby extend their zone.

“The area is starting to look a little bit like Alaska, at first looked worthless, now may not be worthless,” Valencia said. “The East China Sea is virtually all continental shelf, which means it’s all relatively easy digging except in typhoon season.”

But the likelihood the areas will be developed dwindles as the political storm brews between China and Japan. If this fracas follows past contretemps, the two sides will cool for a few months before rapprochement from high-level officials on both sides. But with the leadership change coming in China, and leadership elections imminent in Japan’s two major parties, the likelihood is tensions will remain high. “No one wants to be perceived as soft on China,” Manicom said.

Meanwhile, as historic enmities over Japan’s war past inflame tensions in China, public sentiment is changing in Japan toward China.

“The result is the average Japanese person views China with more suspicion than the past,” Manicom said. “You can now be anti-China in Japan and not be conservative, which is a development that I think took Beijing by surprise.”

China’s claims to the disputed islands in the South China Sea and their inclusion on a map that depicts a U-shaped line that comes perilously close to the coastal waters of the countries that abut the sea, have given rise to concern and debate about the line’s meaning. At stake are billions of dollars in fishing and mineral rights that all of the parties to the debate each claim as their own.

Although the dispute over the Paracels started as long ago as 1909 between China and colonial Vietnam, then represented by France, and that over the Spratlys started in the 1930s between France and Japan, the arguments over the maritime space beyond 12 nautical miles from these islands are relatively recent.

In the 1960s Indonesia and Malaysia began to make claims to the continental shelf in the southern part of the South China Sea and in 1969 the two countries signed a demarcation agreement. In 1971 the then Republic of Vietnam, i.e., South Vietnam, declared a continental shelf claim that overlapped with those of Malaysia and Indonesia.

China — that is, the pre-1949 Kuomintang government — advanced a claim to the Spratlys from the end of the Second World War, and published a map in 1948 showing the now-well-known U-shaped line. Although the area inside that line overlaps the continental shelf claims of Indonesia, Malaysia and South Vietnam, neither the People’s Republic of China in Beijing nor the Nationalists now camped in Taipei objected to these claims, nor to the 1969 Indonesia-Malaysia agreement, nor did they advance any claims of their own.
In the 1990s, however, the government in Beijing started to protest against Vietnam’s oil and gas activities in the Nam Con Son and Vanguard Bank areas, and in 1992 it awarded an area of 25,000 sq km in the Vanguard Bank area to a US company. Since then, China’s words and actions in claiming maritime space far beyond 12 nautical miles from the disputed islands have been increasingly assertive.

In this context, China’s inclusion of a map that depicts the U-shaped line in unsigned diplomatic notes sent to the Commission on The Limit of the Continental Shelf in 2009, without explanation of the line’s meaning, has given rise to much discussion. Experts and diplomats ponder what China intends to claim inside that line and how China might use that line to support its claims.

Four potential meanings of the U-shaped line have been advanced and will be considered here.

Interpretations:

China’s Foreign Ministry has stated that China claims the islands inside the U-shaped line. By international law, this would include the 12-nautical-mile territorial sea and any EXCLUSIVE ZONE and continental shelf that these islands generate. If this is all what China is claiming, with no implication that this line represents a claim to rights over maritime space right up to it, then this would be the most reasonable and legally valid interpretation of the U-shaped line. If the U-shaped line represents such claims, it is no more controversial than the claims to islands by other states. However, China has not stated that this is all what the U-shaped line represents.

The government of the Republic of China (i.e., the Taiwan authorities), which is not recognized as a sovereign state, has described the area inside the U-shaped line as historical waters. This view is shared by some mainland scholars. However, international law has never recognized claims of historical waters that extend so far out to sea and cover such a vast area. In any case, there is no evidence that China has historically exercised sovereignty over the area enclosed by the U-shaped line. Therefore the interpretation of the area inside the U-shaped line as historical waters is overwhelmingly rejected by international law and evidence. Furthermore, given that historical waters are normally enclosed by baselines rather than lie outside them, such interpretation would be inconsistent with baseline declarations made by the PRC.

China’s diplomatic note to the CLCS in 2009 in relation to Vietnam and Malaysia’s unilateral and joint CLCS submissions claim sovereignty over the “adjacent waters” of the islands in the South China Sea and sovereign rights and jurisdiction over “relevant waters as well as the seabed and subsoil thereof”, referring to a map on which the U-shaped line is depicted, but without declaring that this line demarcates any of these areas. In 2011, China submitted a further asserting that “China’s Nansha Islands is fully entitled to Territorial Sea, Exclusive Economic Zones and Continental Shelf”. These notes seem to support a third interpretation: that China intends to claim the area inside the U-shaped line as an exclusive zone and continental shelf generated by the disputed Paracels, Spratlys and Scarborough Reef. However, while this is a possible speculation, there has been no official statement from China to confirm it. Further, given that the U-shaped line for the most part lies closer to undisputed territories than to the disputed Paracels, Spratlys and Scarborough Reef, it would be impossible for China to justify it as a boundary for the exclusive zone and continental shelf generated by these features.

Since China is not ready to settle for the first interpretation, and since the second and third are clearly indefensible under international law, in recent years Chinese scholars have advanced a fourth interpretation. According to this interpretation, China’s claims in the South China Sea are composed of three layers. In the first, China claims the disputed islands. In the second, it claims the exclusive zone and continental shelf generated by those islands, which might not extend as far as the U-shaped line. In the third layer, China claims “historic rights” over maritime space beyond 12 nautical miles from the islands, with the U-shaped line being either the limit or both the basis and the limit for this claim.

by Bonnie Glaser | Foreign Policy - With China and Japan at odds over disputed islands to the east, the potential for conflict in the south may seem muted for now. But not for long.

As Defense Secretary Leon Panetta’s visit to Japan, China, and New Zealand shows, President Barack Obama’s “pivot to Asia” continues apace. But if U.S. policy toward this strategically important region is to be successful, it must take into account a paradox: China’s neighbors seek greater U.S. economic, diplomatic and military involvement in the region as a counterbalance to China’s growing power — but at the same time, every country in the region also desires a close relationship with Beijing.

The difficulty of navigating this paradox is clearly evident in the handling of territorial disputes in the South China Sea. Southeast Asian nations periodically urge Washington to help them stand up to Chinese pressure to accept Beijing’s expansive claims there — but when Washington acts to prevent China from running roughshod over the region, its partners’ concerns about U.S.-China tensions spike and they implore the United States to step back. It is this paradox that makes maintaining a consistent and principled U.S. policy on the South China Sea both challenging and essential.

The United States has a great deal at stake in the South China Sea. It is one of the world’s primary trade arteries, with over half of the world’s merchant fleet by tonnage sailing through those sea-lanes each year. The region also contains an abundance of fish — an important source of revenue for the bordering countries’ economies – and potentially contains significant quantities of oil and gas resources strategically located near large energy-consuming countries.

Yet the South China Sea is a tangle of competing territorial demands. China, Taiwan, Indonesia, the Philippines, Vietnam, Malaysia, and Brunei all assert overlapping claims over land features and adjacent waters in the sea, heightening diplomatic tensions and potentially laying the foundation for a future military conflict. And while no country is blameless in this standoff, China is clearly the most egregious aggressor. It is currently following a deliberate policy of bullying and intimidating its smaller neighbors into recognizing its sovereignty over large swathes of the sea — and the United States must clearly communicate that such behavior is unacceptable.

The South China Sea has long been a military flashpoint. Skirmishes took place periodically on its waters from the mid-1970s to the mid-1990s. A decade of relative quiescence followed, but tensions have flared since 2007, with a marked increase in incidents and provocations. The main causes of growing tensions are rising interest in surveying and exploiting the South China Sea’s oil and gas deposits, intensified competition for fish as stocks in close proximity to coastlines are depleted, and growing nationalistic pressures on governments to defend their territorial and maritime claims.

The most serious confrontation in decades took place this past spring over a triangular-shaped chain of reefs and rocks called Scarborough Shoal, located approximately 124 nautical miles from Zambales, the Philippines. In early April, a Philippines frigate, which had been deployed to observe a pending North Korean missile launch, was redirected to Scarborough Shoal to investigate the presence of eight Chinese fishing boats in the lagoon. Infuriated by what it viewed as a provocative and escalatory action, China dispatched two large maritime surveillance ships to the shoal, which positioned themselves between the Chinese fishing vessels and the Philippine warship. Over the ensuing weeks, Manila withdrew the frigate and replaced it with a coast guard cutter, while the Chinese increased their presence, at one point deploying approximately eighty surveillance ships, fishing boats, and utility craft in the lagoon. Manila’s staunch refusal to withdraw was met with additional Chinese intimidation: Beijing began to quarantine tropical fruit imports from the Philippines and apply other forms of economic pressure. Quiet diplomacy produced a verbal agreement in early June that both sides would pull out their ships and end the standoff, but only Manila complied. After the Philippines withdrew, China roped off the mouth of the lagoon to prevent Filipino and other fishermen from entering, and stepped up patrols around the shoal.

It’s clear that there is a cycle of escalation underway in the South China Sea that threatens to destabilize this critical region. However, it is important to note that China’s claims, policies, ambitions, behavior, and capabilities are significantly different from those of other actors. Beijing resists engaging in multilateral discussions on the territorial and maritime disputes in the region, preferring bilateral mechanisms where it can apply leverage over smaller, weaker parties. It rejects a role for the International Court of Justice (ICJ) or the International Tribunal on the Law of the Sea (ITLOS) in resolving the territorial and maritime disputes in the South China Sea.

Although Beijing has agreed to eventually enter into negotiations to reach a code of conduct for the South China Sea, Chinese officials have recently stated that discussions can only take place “when conditions are ripe” — which, evidently, is not now. The United States views a code of conduct as a tool for conflict prevention and conflict resolution, and urges negotiations to begin immediately. Chinese officials, meanwhile, prefer the 2002 Declaration on the Conduct of Parties in the South China Sea, which has no dispute resolution mechanism and is not legally binding.

by the Editorial Board | Chicago Tribune - Commentory: Beijing is proving to be its own worst enemy.

The world has many trouble spots that have long posed a risk to peace and stability — the Persian Gulf, Israel and its neighbors, and the Afghanistan-Pakistan border, to name the most obvious. One looming danger is far from the usual arc of crisis. It’s the South China Sea, where territorial disputes and national ambitions are heightening tension and posing a small but not insignificant risk of escalation.

China has long been at odds with many of its neighbors over various islands in these waters. A few months ago, Chinese and Philippine naval vessels entered a tense standoff over the disputed Scarborough Shoal. In March, China detained Vietnamese it accused of fishing illegally near the Paracel Islands, which it occupies over the protests of other countries in the area.

This summer, Beijing announced it would install troops on one of the Spratly Islands, which are also claimed by Vietnam. Oh, and China has been quarreling noisily with Japan over islands in the East China Sea.

The general problem arises from Beijing’s growing assertiveness in the area, and its urge to restore what it sees as its historic sovereignty. Its neighbors, however, read history differently, and they regard China with a mix of age-old hostility and new concern about its rising power. The presence of oil and other valuable resources has raised the stakes.

But the disagreements have implications beyond the locals. As the dominant naval power in the Pacific and the world, the United States has an interest in preserving that position as well as maintaining unrestricted navigation in the region. It sees such freedom as crucial to worldwide trade, much of which is borne on merchant vessels. It also has ties with many of the countries currently at odds with Beijing, which see Washington as a vital counterweight to their giant neighbor.

These clashes are one reason the Obama administration announced a “pivot to Asia” earlier this year, which included the deployment of Marines to Australia. The goal is to provide support for friends as well as facilitate peaceful settlement of disagreements.

But the shift has evoked anger from the Chinese, who advise that the U.S. gracefully accept its inevitable decline. They insist the disputes should be resolved strictly by those countries that are “directly concerned,” which pointedly excludes America.

When Secretary of State Hillary Rodham Clinton visited Beijing last week, the Chinese rebuffed her call for regional negotiations — and canceled a scheduled meeting between her and Vice President Xi Jinping, who is expected to become China’s top leader later this year.

With its overbearing manner, though, China has done an excellent job of frustrating its own goals. The more it throws its weight around, the more its neighbors are motivated to coalesce in self-protection — and to seek shelter in the arms of the U.S., whose military capabilities dwarf those of China.

Over the years, the Americans have had their share of differences with Vietnam and the Philippines, among others. But these nations know Washington can be trusted more than Beijing because it has no territorial ambitions in the region. Its chief interests — free navigation and nonviolent settlement of disagreements — align well with theirs.

Maybe one of these days the Chinese government will come to see that these principles pose no threat to its position. As a huge country with growing wealth and military power, China has to tread gently to avoid provoking a backlash that will hinder its ambitions. It has much to gain from multilateral cooperation and much to lose from unilateral assertiveness.

Many people in the Chinese government and military think the U.S. is essentially hostile and determined to prevent China from gaining its rightful place in the Pacific and the world. But in many ways, China is proving to be its own worst enemy.

The South China Sea is often presented as one of the world’s thorniest territorial disputes. A group of objective, completely disinterested observers, however, would likely find this characterization peculiar. Indeed, to these hypothetical people, it would seem painfully obvious what needed to be done to at least significantly reduce the tensions in the South China Sea. Such a plan would likely start with four simple steps:

Step 1: Put sovereignty issues to one side. These are too complex and too emotive to be solved in the foreseeable future.

Step 2: Establish who claims what. China, for example, is extremely protective of its sovereignty, but it has never made a precise declaration about which areas of the South China Sea it actually owns (vaguely drawing dashes on a map doesn’t count). Claims should be filed with the UN’s International Court of Justice by a certain date – complete with latitude or longitude coordinates – or be considered frivolous by the rest of the world.

Step 3: Use UNCLOS wherever possible. Here’s a happy coincidence: all South China Sea claimants have ratified the United Nations Convention on the Law of the Sea. That should make this situation so much easier to handle. For areas that are not contested, UNCLOS clearly lays out the rights of the claimant state and also of non-claimant states in territorial waters and exclusive economic zones. Any problems and the Convention (Article 279 ff.) also has a detailed dispute-resolution mechanism.

Step 4: Neutralize the contested areas. If the disputants really want to maintain peace and stability in the South China Sea – and they all say that they do – then they obviously need to draw up a set of rules governing what is and is not allowed in disputed zones. They could call it a Code of Conduct, or some something of the sort. Likely rules would include: the demilitarization of disputed areas; refraining from any provocative rhetoric or action, such as new construction projects on contested islands; no exploration for, or exploitation of, marine resources, unless the claimants agree to do it jointly; and the establishment of a dispute resolution mechanism, probably under the auspices of the ICJ.

It all sounds so simple. But beyond the realms of this “Fantasy Dispute Resolution” and back in the messy world of international politics, this tidy plan is a complete non-starter. The underlying reason for this is that different countries diagnose the South China Sea problem differently. Some think the situation is dangerous and needs fixing. Others, notably China, are actually quite comfortable with the status-quo.

For many observers, the recent disputes over Scarborough Shoal and other island territories have become a matter of great concern. Beijing is less disturbed, however. In fact, China’s strategy is to maintain this sometimes messy status-quo, while making outward demonstrations of being cooperative about seeking a lasting solution so as to guard against accusations that it is the problem. It calculates that these tensions are unlikely to lead to conflict, and that they are an acceptable price to pay for its continued ability to act with relative impunity in disputed areas. At the same time, Beijing doesn’t want to overstep the mark, which would harm its standing in Southeast Asia (many parts of which are pro-China), and invite greater U.S. involvement in the region.

Beijing’s grandest cooperative gesture to date was its establishment of the 3 billion yuan ($473 billion USD) China-ASEAN Maritime Cooperation Fund in 2011. Discussions are now underway about how this money can be spent in order to help implement the 2002 Declaration of Conduct (DOC) in the South China Sea. According to Ian Storey, a senior fellow at the Institute of Southeast Asian Studies in Singapore, this is all building up to a tenth anniversary communiqué to mark the original signing of the DOC. But is this really anything to celebrate? The DOC is a failed protocol that was never properly implemented – which is why momentum has built up behind the formulation of a new Code of Conduct. “China’s view is that some ASEAN members have repeatedly violated the DOC; that’s also the view of some of the ASEAN countries about China,” Storey remarks.

“But is China serious about an effective Code of Conduct?” he asks. “I think the answer is no. A really effective code would constrain China’s freedom of manoeuver in the South China Sea, and big countries don’t like that.”

The Philippines, Vietnam, and other interested parties have doubtless reached the same conclusion about China’s commitment to crafting a meaningful COC. Filipino proposals backed by Hanoi for a robust COC have already been diluted by other ASEAN members, for fear of antagonizing China. More recently, the July ASEAN Foreign Ministers Meeting held in Phnom Penh descended into a farce, with Cambodia, the current Chair, blocking constructive debate about the South China Sea dispute in defense of China’s interests. Cambodia has sold ASEAN out: in doing so, it has facilitated a Chinese policy of extraterritorial interference in Southeast Asia’s key institution. For China, it’s been a foreign-policy coup.

Indonesia – doing the job that Cambodia failed to do – subsequently showed ASEAN some leadership after the Phnom Penh fiasco, cobbling together a common position called the “Six-Point Principles on the South China Sea”. Though better than the Cambodian no-show, it’s a lax document that goes no further than calling for “an early conclusion” to the COC drafting process.

That won’t happen. China has already begun soft-pedaling on talks, which are now unlikely to happen until 2013 (the upcoming leadership handover in Beijing all but rules out near-term movement on what has become such a contentious issue). A new code is therefore unlikely to emerge before 2014 at the earliest.

It would be worth the wait, of course, if it was a business-like code that really sought to regulate the behavior of claimant states. But nobody expects it to be. “China will not accept anything that is mandatory,” concludes Carlyle Thayer, an emeritus professor at the Australian Defence Force Academy.

However, these attractive aspects of cooperative diplomacy are outweighed by Beijing’s instinct not to give any ground where sovereignty issues are concerned. “When it comes to high-stake, high-politics issues, such as territorial disputes and strategic rivalries, international agreements have limited impact,” suggests Zhang Baohui, an associate professor at Lingnan University in Hong Kong. “Overall I think China is a status quo power on the South China Sea issues,” Zhang but observes that upholding the status quo cuts both ways: China won’t facilitate a lasting solution, but it won’t be the one to provoke a confrontation either. It will only react forcefully to perceived provocations on the part of others, as in its recent dispute with Manila. At the same time, it will not hold back from pushing the envelope of acceptable behavior, such as upgrading Sansha to city status, for example, or granting new drilling rights to Chinese oil companies.

But what is China’s ultimate objective in all of this? “They just want to play for time, and to drag it out as long as possible,” argues Storey. “What is China’s end game? I don’t think they know themselves.”

Sadly, there is no Plan B for the South China Sea. China and ASEAN appear locked into the futile process of formulating a Code of Conduct that won’t address the types of conduct that actually need addressing. Pity the poor diplomats who will be spending the next two years working on it. The COC is another fantasy – only one that won’t sound good either in theory or in practice.

by Mark J. Valencia | Global Asia - The latest act in the long-running saga of the South China Sea has seen China moving aggressively to enforce its claim to most of the features of the potentially oil-rich sea while the US ‘rebalanced’ its defense and foreign policy toward Asia. As a partial result of US-China rivalry, ASEAN’s unity and its centrality to security issues are facing a severe crisis. The drama is far from over, writes Mark J. Valencia, and the road to a satisfactory management of the South China Sea conflicts is fraught with peril.

THERE HAVE BEEN numerous significant developments in the South China Sea disputes over the past year.1 At the end of 2011 there was in place a weak and leaking Declaration on Conduct (DoC) for activities in the sea as well as vague and general guidelines for its implementation. The bilateral/multilateral conundrum regarding the process of negotiations between China and ASEAN loomed large. The Philippines was mounting a campaign to get China to clarify its nine-dashed line claim (see map on page 60) and pushing a proposal for a Zone of Peace, Freedom, Friendship and Co-operation designed to separate “disputed” from “non-disputed” areas in the South China Sea. China had warned Vietnam, the Philippines and India (its national oil company ONGC was operating in the sea under license from Vietnam) against exploring for hydrocarbons within its claim line. Yet both ONGC and Forum Energy/Philex Petroleum had announced plans to drill in 2012 in areas claimed by China — the latter on Reed Bank. India had entered the mix not only via its national oil company but by insisting that it has a rightful naval interest in the South China Sea.
Most significant, the US-China rivalry in the region was intensifying, sucking ASEAN and its members into its turbulent political wake. Indeed the disputes had become a new cockpit of China-US competition, distorting and overshadowing the intra-ASEAN and ASEAN-China disputes. The US-China rivalry was driving the issues forward and creating pressure on ASEAN and China to make progress or at least put together a temporary arrangement regarding the disputes.

This paper covers developments from the November 2011 Bali summits through the July 2012 Phnom Penh ASEAN meetings and their immediate aftermath. It summarizes the current political and strategic context, significant developments and the current situation, and then sketches several alternative futures.

The Political And Strategic Context

The tectonic plates of the international political system are inexorably grinding against one another, and the US and China are on opposite sides of the divide — and perhaps history. The US is yesterday’s and today’s sole superpower, but its credibility, legitimacy and ability to enforce its will are fast eroding.2 China’s leaders believe China represents the future, not just in hard power but also in economy, culture and values. Indeed, China’s leaders believe it is China’s destiny to regain its prominence — if not pre-eminence — in the region and perhaps eventually the world.

In classic realist theory, established powers strive to preserve the status quo that assures their position at the top of the hierarchy and view emerging powers as potential threats. Rising powers feel constrained by the status quo and naturally strive to stretch the sinews of the international system. They fear that the dominant power will try to snuff them out before they become an existential threat. These are the primordial political dynamics of the US-China struggle.

Their rivalry is fast becoming a zero-sum game, and both are extremely suspicious of each other’s intentions. Indeed, both countries “see deep dangers and threatening motivations in the policies of the others.”3 It does not help that leadership transitions are under way in both countries, and no candidate for leadership in either country can afford to be seen as weak on such security issues. Some US analysts even see an incipient Chinese “Monroe Doctrine” that would attempt to push the US out of the region.4 Worse, the US and China are tacitly forcing Asian countries to choose between them.

It would appear that the region is now at several tipping points regarding regional security architecture. Key questions include:

• Can ASEAN maintain unity by resolving its internal differences on these issues or is ASEAN unity in security a myth and an impossible dream in an era of competing big power strategic concepts and capabilities?

• Will ASEAN maintain its centrality in its own creations like the East Asia Summit and the ASEAN Regional Forum?5

• Will US-China rivalry dominate these and other ASEAN “Plus” forums?

• Will the US attempt to drive the agenda of these forums and to emphasize negotiations and deliverables as opposed to ASEAN’s more laissez- faire approach?

• Will robust US participation in Asian political and military affairs survive looming defense budget cuts and the coming change of administrations or key personnel?6

The strategic goal of the US in Asia — besides spreading its values and way of life, including to China — is to maintain stability and the status quo by deterring Chinese aggression or coercion against its Asian “allies.” The conceptual intent is to encourage China to buy into existing international law and the order built by the West after World War II. US Defense Secretary Leon Panetta said at the June 2012 Shangri-la Dialogue, “If both of us abide by international rules and international order, if both of us can work together to promote peace and prosperity and resolve disputes in this region, then both of us will benefit.”7

Panetta also has said that “the United States will renew its naval power across the Asia-Pacific region and stay ‘vigilant’ in the face of China’s growing military,”8 adding that “the key to that region is to develop a new era of defense co-operation between our countries, one in which our militaries share security burdens in order to advance peace in the Asia-Pacific and around the world.”

However, US reassurance of its allies and friends may have emboldened some to confront China. Further, US attempts to control regional institutions are likely to be perceived by some Southeast Asian countries as upsetting an already delicate geopolitical balance. For them, how the US behaves regarding the South China Sea disputes will say quite a bit about the future geopolitical environment.

China basically believes that Southeast Asian claimants to various islands are nibbling away at its legacy and rightful ownership of islands and resources in the South China Sea and that they are colluding with the US against China.

Moreover, China is gaining confidence as its economic and military might grow. However, China is facing a strategic dilemma in that its efforts to defend its maritime claims and interests are conflicting with its policy to improve relations with Southeast Asian countries. Its goal is to restore its “tarnished image in East Asia and to reduce the rationale for a more active US role there.” It recognizes that Western “soft power”9 has an advantage in the region and that it needs to “fight back” in kind.10

But China also continues to hint at its hard power. Indeed, Defense Ministry spokesman Geng Yansheng has said that the armed forces have vowed to “fulfill their duty” to safeguard China’s territory, rights and interests in the South China Sea.11 China is rapidly developing the unmanned aerial vehicles and littoral combat ships that it would need to confront the US Navy. Meanwhile, Chinese policy-makers “talk openly about their intent to oppose American unipolarity, revise the global order and command a greater share of global prestige and influence.”12

The current US “rebalancing” in Asia has disturbed Beijing’s military strategic planning.13 One Chinese strategic analyst sees the US balancing as a cover for “forging its alliances into the first island chain … while retreating its own military to the second island chain.” China’s leaders increasingly view the US alliance system in Asia as a relic of the Cold War,14 and they argue that the trend in Asia is toward peace and co-operation, not military alliance-building and the continuation of Cold War thinking.15

Some US conservatives argue that China is seeking to take advantage of the US preoccupation with this November’s elections to push hard in the South China Sea.16 Others say that China seeks to advance its cause incrementally, its policy-makers “extending and strengthening their influence wherever possible, while working quietly to weaken Washington’s position.”17

China clearly realizes that the US is not going to go away on its own nor reduce the pressure of its presence in the region. Indeed, contrary to China’s characterization of it as an “outside power,” the US says it is part of the Pacific family of nations and that it has a valid interest in freedom of navigation and access to the international commons in the South China Sea. The eventual result may be the pitting of China’s “denial of access” against US “assurance of access.” However, some Chinese strategists have warned their government that the South China Sea could become a trap that will divert and waste China’s economic and political capital.

One possibility — though unlikely — is the US and China agreeing to “deal with one another as equals.”18 Some suggest a grand bargain “centered around a Sino-US condominium — with the (tacit) approval of other major powers such as India, Japan and Australia.”19 Such an order would “establish principles or ‘red lines’ that the US and China would agree not to cross — most notably a guarantee not to use force without the other’s permission, or [except] in clear self-defense.” The fundamental challenge for the US is to discourage China’s aggressiveness while convincing China that the US is not its enemy — a rather delicate task. One interesting twist has been to argue that the US presence provides reassurance to smaller nations so that China can continue its rise without appearing to threaten them. Others suggest that China’s increasing dependence on raw material imports will inevitably lead it to challenge the US role in Asia, resulting in security competition.

US-China military relations are already poor and deteriorating. “The PLA is quite transparent about intentions, but opaque about their capabilities. The United States is the reverse … transparent about capabilities but ambiguous about intentions,” as one analyst put it.20 The two have been unable to agree even on an agenda for military talks. China insists that the US stop arms sales to Taiwan, cease “close-in” maritime and aerial surveillance of China, and remove restrictions on exporting American military technology to China.21 Although their May Strategic and Security Dialogue was marred by the case of rights activist Chen Guangcheng, who sought refuge in the US Embassy in Beijing and eventually was allowed to resettle in New York, the defense chiefs of the two countries subsequently met in Washington and US Secretary of Defense Leon Panetta visited China.22 It was hoped that these meetings would lead to a lowering of tension between the two powers. But this appears not to have followed.

by Denny Roy | Asia Pacific Bulletin - HONOLULU — The South China Sea territorial dispute increasingly looks like a point of strategic friction between the United States and China after a recent nasty exchange between the two governments. The U.S. Department of State criticized China for its plan to base a new military garrison in the Paracel Islands, saying this would increase international tensions. Beijing shot back that the United States should mind its own business.

Illustrated photo (C) ibtimes.com

Many observers wonder why Washington and Beijing are allowing a new irritant to emerge in the incalculably important U.S.-China relationship. Unfortunately, there is widespread misunderstanding about the U.S. rationale for America’s diplomatic intervention in a territorial dispute to which the United States is not a party.

Although U.S. officials have named several specific U.S. concerns about China’s policies and activities in the South China Sea, the U.S. concern most widely understood and repeated is the potential threat to “freedom of navigation”: the PRC might be moving toward imposing restrictions on foreign ships sailing in the South China Sea. This, however, is not the real issue. It is really about bullying.

To be sure, the United States is a strong proponent of freedom of navigation in international waters. This stance reflects not only America’s commitment to the general principle of liberty but also the interests of a trading nation with the world’s most capable navy. There should be no doubt that if freedom of navigation was in jeopardy in the South China Sea, the United States would spring to its defense. At present, however, freedom of navigation is not at issue.

The Chinese say they do not interfere with international navigation in the South China Sea and do not intend to in the future. Their position has some merit.

China has a particular beef with surveillance by U.S. ships and aircraft near the Chinese coast. This has resulted in Chinese harassment, with several incidents reported in the press. The UN Law of the Sea Treaty allows for spying in the region between a country’s internal waters limit—12 nautical miles—and its exclusive economic zone limit which is usually 200 nm.

The Chinese argue that spying is not “innocent passage” and should not be allowed within the EEZ. It is not an unreasonable argument. So this situation has resulted in some interference with the “free navigation” of the U.S. Navy, but this is a very limited and special case.

The other circumstance in which Chinese vessels have interfered with non-Chinese ships is when the latter are engaged in activities that involve taking resources—fishing or preparing to drill for hydrocarbons—or when foreigners are attempting to arrest Chinese fishermen. These, as well, are special cases. Otherwise, the Chinese have not interfered with the passage of cargo ships of any flag or of U.S. Navy vessels passing through the waterway.

Consequently, the Chinese assert that the freedom of navigation argument is bogus, and the assertion is persuasive to many neutral onlookers. From here the Chinese charge that the Americans are using freedom of the seas as a pretext to extend the alleged “containment” strategy to Southeast Asia, limiting Chinese influence and recruiting new allies to join in the military encirclement of China.

Instead of providing fodder for Chinese rhetoric, the freedom of navigation argument should remain in the background. Rather, what the U.S. government should be talking about is making the world safe from unlawful international coercion. Ironically, the Chinese have begun practicing what Beijing’s diplomats have for decades condemned as “hegemonism” or “power politics”—strong countries forcing their self-interested preferences onto smaller countries.

Six governments claim ownership of parts of the South China Sea. None has a slam-dunk case. China is not the only claimant that has moved unilaterally to strengthen its control over South China Sea territory and resources in recent years. China, however, has distinguished itself in two important and negative ways.

First, China’s claims are both unusually expansive and intentionally vague. Beijing has stubbornly refused to clarify its claims based on the guidelines in the international Law of the Sea treaty, to which the PRC is a signatory. This is part of a strategy of ambiguity by which the PRC tries to minimize global concern and to avoid being constrained by the Law of the Sea guidelines while taking actions aimed at intimidating individual rival claimants.

Second, the actions China has taken to assert ownership over the South China Sea and its tiny “islands” are stronger than those taken by the other claimants. These acts include threatening and damaging foreign ships, declaring a fishing ban for part of the year in half of the South China Sea and arresting foreign fisherman who do not comply. There is also the recent announcement of increased Chinese militarization of the region—not only the new garrison, but the statement by military spokesman Geng Yansheng in June that China has begun “regular, combat-ready patrols” in the South China Sea.

China’s actions are threatening because China is big. No other state in Southeast Asia can match the military power China is able to project into the South China Sea. China’s massive economic weight, rapid growth rate, and commitment to strengthening its military forces ensure that the gap will only grow larger in the future. To make the contest even more lopsided, the Chinese government recently announced plans to greatly increase the number of quasi-military patrol ships—operated by the PRC Coast Guard and other agencies—it will deploy in the South China Sea.

In effect, this is a struggle between two visions of international order for Asia. The U.S. vision includes a system of norms and international laws that ensure, among other things, that small states are protected from predation by larger states and that dispute resolution procedures should be fair. China, on the other hand, appears to favor restoring a Chinese sphere of influence in East and Southeast Asia such as the Middle Kingdom enjoyed anciently.

Under this arrangement, the rules of international interaction would reflect basic Chinese interests. Beijing would expect regional governments not to take major decisions that run contrary to Chinese preferences. Beijing’s current unwillingness to base Chinese claims in the Law of the Sea treaty may reflect the sentiment that this mostly Western-written body of law will not be needed when China resumes its historical position of regional dominance.

Some observers see the China-U.S. contention over the South China Sea as simply a squabble between two great powers that are both seeking regional domination, with each acting in its respective hegemonic self-interest rather than in defense of some higher principle. In this case, however, U.S. intervention is clearly aligned with the interests of the Southeast Asian countries, which seek to avoid domination by China or any other great power. China is trying to implement a might-makes-right order, while the United States is trying to ensure that smaller countries do not get steamrolled. This is the real issue, and U.S. officials should make it clear.